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Executive Summary

Novo Nordisk insulin sales climbed 10% in 1991, to approximately $820 mil. (based on a conversion rate of $1 = DKK 5.91), the firm reported March 11. Insulin accounted for 76% of a total $1.08 bil. in revenues generated by Novo's Health Care Group, compared with 78% the year before. "Novo Nordisk's market share increased in key markets, including the United States, Japan and Germany," the firm said. However, "sales of insulin to the former Soviet Union were considerably lower in 1991 than the previous year." Human insulin sales accounted for 56% of the group's total insulin volume, compared with 51% in 1990. Novo noted that one of its long-term insulin projects, development of a nasal formulation, has hit a roadblock. Nasal insulin research "continues to have a high priority," the company said, but "very recent clinical results indicate a need for further optimization of the product." In the June 1991 issue of Novo's in-house Novo Nordisk Magazine, the company said that early results from the nasal insulin program had been acclaimed at a European Association for the Study of Diabetes meeting as "very promising indeed." In the same article, Novo Senior VP for Diabetes Research Lise Heding said: "I would be disappointed if we are unable to [launch a nasal insulin formulation] within a range of three to five years from now." Novo now says that the more recent findings are "expected to delay the project by one to two years." Overall, Novo reported a 22.1% increase in net earnings for the year to $156.9 mil. on sales of $1.6 bil., up 16.2%. "Less than" 3% of the sales increase is attributable to currency exchange rates for 1991, the company said. Revenues in the Health Care Group advanced 12%; Novo said it expects "a relatively even rate of growth" in that business for the current year. "Sales increased despite the divestiture of the veterinary business and the termination of certain marketing agreements in Scandinavia as of Dec. 31, 1990," the firm noted. "On a continuing basis the sales increase would have been 15%." Outside of insulin, sales of Norditropin human growth hormone jumped 74%. Combined sales of Novo's gynecological products Trisequens and Kliogest added 52% for the year. Capital spending is expected to increase "considerably" this year due to "extensive expansion" of production capacity both in Denmark and overseas, Novo said. Almost all of the company's production capacity was "fully utilized throughout 1991," Novo noted. The company is in the process of expanding production capacity for insulin in Denmark. In the U.S., Novo began work on a new plant for insulin filling in North Carolina. IVAX moved solidly into the black in 1991 following several quarters of losses in 1990. For the year, IVAX reported net earnings of $11.9 mil. (versus a loss of $760,000 the year earlier) on sales of $181.6 mil. Fourth quarter revenues gained 57.6% to $60.7 mil. Figures for the period include one month of results from generics manufacturer Goldline, acquired by IVAX late in the year. A. L. Labs reported a drop in net income for the year to $5.1 mil. on sales of $295 mil., up 9.1%. The decline in profit reflects a loss of $5.7 mil. in the fourth quarter, following a "substantial charge" to pre-tax earnings, which the company said reduced pre-tax income by about $13 mil. A. L. Labs described the charge as stemming from "current and committed costs for quality and compliance, as well as other issues including personnel initiatives, resulting primarily from heightened regulatory and legislative requirements in the pharmaceutical industry to assure safe and effective products."

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